Government Procurement

Gareth Snell Excerpts

Tuesday 2nd December 2025 Commons Chamber

[Gareth Snell (Stoke-on-Trent Central) (Lab/Co-op)]

When I had the privilege of leading a council in north Staffordshire, we tried to invent a model that allowed us to use the Public Services (Social Value) Act 2012 in exactly the way that my hon. Friend describes, so that when we were working with a registered social landlord on house building, for example, we could stipulate that a proportion of the bricks should come from the local area and that, in turn, apprentices would be working in those factories. I found that it was a matter of political will, but also that procurement officers sometimes struggled to understand how to quantify social value. Does my hon. Friend have a solution—one that the Minister could then cascade through Government—for working out the social value that we are all seeking to achieve?

[Barry Gardiner]

My hon. Friend gives an apposite example of some of the problems that can arise. I will not be so bold as to say I have the solution, but I will at least try to set out the problem with clarity, so that the Minister can ensure that his officers are able to provide a proper solution.

The model details eight types of social value, each with several areas of activity. Those cover fair work, training to address skills gaps, support for small business and community business, action for sustainability, crime reduction, overcoming barriers to work, and support for health and wellbeing. Contracting authorities can choose which of those are relevant to a particular procurement, but one element is mandatory: where a type of social value is selected, the standard reporting metric set out in the model must then be used for monitoring and reporting. Herein lies the problem. These monitoring requirements will influence how social value requirements are described in tenders and contracts. A contracting authority using a targeted recruitment and training toolkit would struggle to comply with the standard reporting metrics, as they would not relate to the tried and tested specifications that are used.

Many of the options in the social value model are related to the jobs, skills and SME opportunities that are contemplated in the national procurement policy statement. However, the model appears to be expecting procurement officials to create tender requirements whereby potential contractors will identify labour shortages and community needs and then propose ways to fill these gaps in the delivery of the contract. That may be possible with a services contract, but it is really not workable in a large, complex building and infrastructure development.

What are my concerns? First, apart from the way outputs are recorded, no specific elements of the social value model are mandatory for contracting authorities, so the provision of opportunities for people who are currently disadvantaged in the labour market is not mandatory. Contracting authorities can choose to focus on other activities contained in the social value model.

Secondly, the approach for every social value option is to require bidders for the contract to provide a comprehensive method statement at tender stage. That puts a heavy burden on potential contractors and is a huge barrier to small businesses bidding for contracts, which is perverse when breaking down barriers to SME engagement is one of the Procurement Act principles and a core mission of the Government.

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[The Parliamentary Secretary, Cabinet Office (Chris Ward)]

I thank my hon. Friend the Member for Brent West (Barry Gardiner) for securing the debate. He raised a number of important and specific points, which I will answer shortly. If he will permit me, I will briefly set out the Government’s approach to procurement, not least because it is the first opportunity that I have had to do so as the Minister responsible for procurement.

I want to emphasise that this Government and I see public procurement as an incredibly important vehicle for social and economic change, and not in the slightest bit boring. Public procurement accounts for one in every three pounds of public spending, totalling some £400 billion a year, so it is a huge opportunity and responsibility to make sure that that budget is spent wisely, and that it does everything possible to boost British jobs and growth, and delivers opportunity and fairness across the country.

[Gareth Snell]

To follow up on the point made by my hon. Friend the Member for Rugby (John Slinger) about the great announcement that police forces will be able to buy things locally, when will the Minister extend that to ensure that British police services are buying British cars, that the Government car service is buying British cars, that the Motability scheme is using British cars and that the Foreign, Commonwealth and Development Office fleet is using British cars? All those currently use foreign-made vehicles, which is not using British taxpayers’ money for British jobs.

[Chris Ward]

As my hon. Friend knows, the Budget announced progress on that with the Motability scheme, and the Chancellor has spoken many times about the need to buy British. Hopefully, we can start to roll that out and make much greater progress on it. I am glad he welcomes today’s announcement, which I will come to, but whether we are talking about British steel, British shipbuilding, wind farms or, as we saw in the Budget last week, driving innovation and spurring investment across the UK, we need to do far more to ensure that we buy British.

That is also why, just this week, as my hon. Friend the Member for Rugby (John Slinger) said, we have announced measures to allow local authorities to reserve contracts for suppliers in their area. That will help to keep more than £1 billion of potential spend in local communities, and it will benefit small and local firms considerably. This flows from our decision earlier this year to publish a national procurement policy statement that required contracting authorities to consider wider objectives, such as creating local skills, jobs and opportunities, and to maximise procurement spend with small and medium-sized enterprises.

Over the summer, the Government consulted on a range of proposals to go further, including broadening the definition of national security to economic security, allowing greater support for critical UK industries, such as shipbuilding or steel, and plans to introduce a public interest test to support and help deliver a wave of insourcing. The proposals also included further expanding support and opportunities for SMEs, including tackling the scourge of late payments, and, to go to the thrust of the remarks made by my hon. Friend the Member for Brent West, reforming and tightening the definition of social value to see it delivered much more effectively.

We are working through the consultation responses. I have met with a number of businesses, unions and contracting authorities to discuss this further, and we are drawing up plans to bring forward legislation in the next session for a new procurement Bill to deliver these changes.

As the Minister responsible for procurement, I have two central goals. The first is to make the current procurement regime less bureaucratic and burdensome—streamlining the processes wherever possible, reducing unnecessary form-filling and, in particular, making it easier and fairer for SMEs. The second is to ensure that every pound of that £400 billion procurement budget is used to support British jobs, British industries and growth across the country. Within that second goal lies the question of social value, which my hon. Friend raised. I am sympathetic to a number of points he made, and I have discussed particularly with SMEs recently how we can do more in this space.

As my hon. Friend said, the social value model was introduced in 2019 and refreshed in 2025. It is not currently mandatory for all contracting authorities or contracts, and it is applicable only to central Government Departments, executive agencies and non-departmental bodies. As I said, we are consulting on changes that will open up procurement on social value grounds much more widely.

As my hon. Friend will know, the purpose of the social value model in the guidance, which has been in place for only a couple of months, is to ensure that contracting authorities can reward suppliers for more than simply best price, so that they can reflect quality jobs, support people into work and do training opportunities. For example, if we want to build a new road or a new infrastructure project, the contracting authority can consider more than price; it can consider what it does to help the community.

I agree with my hon. Friend that the definition of “community” needs to be improved and clarified. We need to be much clearer about community voice and view on this issue; again, I want to try to bring that forward in the legislation. It is early days to assess the impact of those measures, but I take on board the points that he raises regarding flaws in the process and the need to go further. As I said, that chimes with some of the points that he made.

I am particularly conscious that social value does not become just a tick-box exercise, particularly where large companies can employ more people and consultants and win contracts simply by being able to fill in a form better. That is absolutely not what social value is or should be, and it will absolutely not be what this Government allow to happen when we bring forward legislation in the next Session.

We also need to look at the threshold at which social value requirements apply so that we can ensure that SMEs and community groups have a much more level playing field and we can open up the requirement much more. Again, that will be a part of the consultation.

My hon. Friend asks about the targeted recruitment and training approach for large contracts, and again he made some very good points. I agree that it needs to be a tool to provide local communities with the skills they need. At the moment, the social value model provides some flexibility for contracting authorities in that regard—for example, things such as skills gaps or local problems in the area—but we can do more. I will consider the points he raises and get back to him, and I thank him for those.

My hon. Friend also asks whether all vacancies for works contracts are on the DWP “Find a job” website, and the answer is yes. As of February 2025, there has been a requirement for all Government suppliers to advertise jobs relating to Government contracts in the local jobcentre. As I am sure he can recognise, the aim is to ensure that local people have every opportunity to access quality jobs, but again I will look at the points he makes about how that is playing out and if we can improve it.

The hon. Member for Strangford (Jim Shannon) mentioned Northern Ireland and how we can do more to support procurement there. I am talking with the Northern Ireland Executive about how we can work together and try to ensure that new legislation that we bring forward in the next Session can apply in Northern Ireland, should they wish it to do so.

I thank my hon. Friend the Member for Brent West for securing this important debate. Procurement is one of the most important levers we have in government, and we should have far more debates in this House on it. Procurement matters to Government, to taxpayers, to British business, to workers and to people across the country. The best way that we can support UK businesses further to deliver growth is to go further and faster on reforming public procurement. That is what this Government have already done, and that is what we will continue to do. We will deliver a simpler, less bureaucratic process, better value for taxpayers and more opportunities for local jobs and skills in all parts of the country, and we will bring that forward soon. I thank again my hon. Friend and other Members for contributing to the debate tonight.

Question put and agreed to.